Sergey Kartashov: Why investors leave most startups aside

Generation Partners is a Cyprus-based company that deals with IT asset management. Asset management is a complex and labor-consuming field, especially, when an investor has various companies in its portfolio. A successful investor has to keep tracking a lot of information and profitability of the existing companies in its portfolio. At the same time, it has to look for more projects to add to its portfolio to maintain and increase profitability and reduce risks. Sergey Kartashov, the CEO of Generation Partners, talks about the interests of investors in terms of choosing some startups and leaving aside others.

The Role of IT Asset Managers

The role of an IT asset management firm is to help investors choose the right startups for investment. “Our job is to monitor the market, select startups for investment, and analyze scrupulously their activities,” said Sergey Kartashov. The experts study the ideas, products, business plans, and professional management of the startups. The CEO of Generation Partners clarifies that there are only a few projects that have the ability to attract investors.

The experts can depict the flaws in a startup at first sight. Most of the startups offer duplicate solutions to the existing problems. In other words, they do not have uniqueness. Similarly, there are various ideas that are not supported by the development plan. It is the job of IT asset management experts to find the products and ideas that will come through. Generation Partners deal with clients from all across Europe as it is based on an island that is reachable from every other European country within three hours.

The Reasons Behind Failure of Most IT Startups

Sergey Kartashov expresses that 90% of the startups die during their first year. Half of the startups from the remaining 10% get vanished away within the next five years. There are various reasons behind their failure including lack of funding, management issues, lack of a business model, and lack of a development strategy. Most of the startups make some common mistakes. It makes the job of an IT asset manager easy to find successful startups. “Most startups make some common mistakes. You can identify them when studying the project in detail,” said CEO Generation Partners. Here are some of the common mistakes made by the startups:

1. Lack of a development strategy: Most startups do not pay much attention to the project development strategy. They create a new, unique, and problem-solving product but they still get lost in the flow of information. The key aspects of creating a useful project development strategy include scaling the project, using communication and feedback tools, and determining the target audience. 
2. Lack of a business plan: Most startups do not create a proper business plan. Investors do not pay attention to the startups that forget about monetization. So, the lack of a business plan makes a startup short of funds and results in its death. 
3. Lack of strong management: The proper scaling of a startup requires a strong management team behind it. A startup works as a living body. It has various organs that work together to keep the startup alive. However, if one of the organs work poorly, then the whole body will suffer from it. The startups should work in this dimension seriously to acquire large investments. 

The experts can identify these points clearly during the initial analysis of a startup, according to Sergey Kartashov. He added that some investors help startups in finishing their unfinished strategies by finding the right people for jobs for them. However, if key points are missing, then investors will pay no attention.